NEW DELHI, July 20 (Xinhuanet) -- The bilateral trade between China and India has increased 63 percent in the first quarter of the current fiscal year, Chinese Ambassador to India Sun Yuxi said here Wednesday.

"The bilateral trade has gained momentum since early 2005, and it is predicted that the two countries would be able to achieve their trade target of 20 billion US dollars by 2008, much ahead of schedule," Sun said at an economic seminar organized by India's PHD Chamber of Commerce and Industry.

Sun said, "It is time that we target increasing trade up to 100 billion dollars in the next 5 to 8 years. This is an achievable target as the two governments are in the process of negotiating for facilitating trade and investment between India and China."

Sun also underlined that China was very keen to get observer status in the South Asian Association of Regional Cooperation (SAARC) regional economic group, just as India was given the observer status in the Shanghai Cooperation Organization. "This would enable China to deepen economic ties with the SAARC countries," he said.

The Ambassador also informed that India and China are likely to enter into Free Trade Agreement shortly.

"Given the size of India and China's economies and population,such free trade agreement would be the largest of its kind in the world. Series of consultations at various levels are being held between the two countries to give a formal shape to this Agreement," Sun said.

He noted that opening up of land route through Shangrila in China's Tibetan Autonomous Region and Nathula in India's Sikkim state primarily indicates the firm conviction to put the trade relations on fast track.

The ambassador also urged the government of India to ease visa restrictions which are acting as hindrances to free movement of people across border. He said that the figure of 330,000 people traveling between the two countries last year is too small compared to the large population size. The figure should be actually in millions.

He also said that the Indian visa issuing procedure is too complicated especially in working visas which are issued only for 3 months and are non-renewable. Chinese who visit India for business have to go back to get a new visa issued every 3 months thus affecting business activities.

Earlier, K. N. Memani, President of PHDCCI, in his welcome remarks, said that it was time for both countries to strengthen economic cooperation for mutual benefit. An increasing number of visits of Chinese business delegations to India and delegations from India to China would go a long way in developing people-to-people contacts and strengthening economic ties between the two countries.